French Renault, Iranian IDRO signs €660M agreement

French automaker Renault signed €660 million worth agreement with Industrial Development & Renovation Organization of Iran (IDRO), Trend’s correspondent reported from the event.

The sides would establish a joint venture, with 60 percent Renault’s stock, to manufacture automobiles in Iran.

The Industry, Mine and Trade Minister Mohammad Reza Nematzadeh said during the ceremony that the agreement is the first phase of IDRO- Renault cooperation with worth of €660 million. “The sides are negotiating on sealing the second phase of the agreement, aimed, in the framework of phases 1 and 2, to produce 150,000 autos per year in Iran”.

He said that car production in the framework of the first phase will start next year, adding that the second phase, currently in the final stage of negotiations, would start in 2019 and the relating production line would be commenced in 2022.

He didn’t elaborate on how many cars would be produced in the frameworks of first and second phases separately.

Iran has already resumed cooperation with the French company, but only in auto and auto parts import.

Renault sales in Iran’s car market registered a huge rise by 100.3 percent in the first half of 2017, the company said July 17.

The company’s share in Iran’s market increased to 9.8 percent during the 6-month period year-on-year thanks to the success of Tondar and Sandero models.

The automaker has sold 68,365 units in Iran in the first half of 2017. The company’s sales in January-June stood at 1.88 million units, up by 10.4 percent compared to the same period of 2016 and four times the rate of the global auto market's 2.6 percent expansion.